Mobile phones are a boon and bane to the consumers. Though it keeps all of us connected with each other 24 hours a day and 365 days a year, it becomes a bane when it is used for wrong deeds by unscrupulous people. As technology evolved in the last few decades, the number of frauds and fraudsters have also increased. 

For instance, one afternoon your phone buzzes and there is a message stating that your bank account will be blocked within 24 hours, unless you ‘verify’ your KYC. It seems you have received the message from your bank and it sounds too urgent, but the fact of the matter is it is not at all real.

India has seen a substantial increase in SMS based frauds. SMS based scams in India jumped 146 per cent between late 2025 and early 2026, while mobile fraud sessions rose 67 per cent, according to a BioCatch report. Hackers have become smarter and faster and they are targeting higher-value transfers through mobile phones. As many people in India use SMS for communication, the fraudsters have taken advantage of it to commit frauds through SMS messages. 

For a nation that has grown using UPI in the last 10 years, mobile banking and instant transfers have become a part of everyday life. And when there are a lot of scams happening through SMS and whatsapp messages, these kinds of events will come as a huge blow to consumers and weigh on the trust that people have in the system. 

In this blog, we will explain the ways in which SMS banking scams take place, the signs to watch out for, and the steps an individual can take to protect themselves from such frauds.

How SMS banking scams take place in India

Fraudsters too have evolved with technology and they have gone beyond simple lottery win messages to using tactics that mirror true bank communication. The format of these messages look exactly like the messages from the recipient’s bank. 

Common methods the new-age fraudsters have deployed are sending fake KYC update messages, suggesting that a bank account, card, or courier is blocked, electricity bill and other utility scams, and even WhatsApp based APK scams. 

The Press Information Bureau has warned citizens about phishing scams where fraudsters have impersonated the Reserve Bank of India through WhatsApp messages, falsely claiming that a recipient’s bank account is linked to suspicious transactions and may be blocked unless financial details are provided.

The messages have included an attachment. The fraudulent messages frequently include an APK file that users are asked to download to verify their accounts, and downloading unknown files can compromise a smartphone and allow fraudsters to access banking apps and stored passwords. One tap could prove to be enough.

Red flags to watch out for

While not all scam messages are obvious, many have some common signs that can allow a person to spot a fraud message.

Look out for indications like urgency and fear-mongering, mismatched or generic sender addresses (genuine messages would come from a registered alphanumeric ID), shortened or unfamiliar links (a legitimate bank would rarely use link shortener services for SMS), asking for OTP, PIN, or CVV details (No bank ever asks for these over SMS, call or WhatsApp), spelling and grammatical errors (official communication is usually error-free), and unsolicited attachments (especially APK files), among others.

How to report SMS banking fraud in India

It is important to report fraudulent activities, as it can help ensure that other people are not affected by similar scams.

There are various methods to report SMS-based banking frauds in India. You can report to the National Cyber Crime Helpline – 1930 (for financial fraud). The faster you report to them, the quicker can be the resolution and you may even get funds that have been transferred fraudulently. 

You can also report a cyber fraud online at cybercrime.gov.in. The fraud can also be reported to your bank through their fraud reporting line (most banks now have an instant reporting feature) or to the RBI Ombudsman, if your bank fails to report the scam in a timely manner. If the bank fails to resolve the complaint in time, customers can approach the RBI Ombudsman and then the Appellate Authority.

These kinds of cyber frauds are rampant and massive in India because there were around 24 lakh cases of cyber fraud in 2025 and the value was around Rs 22,495 crore, according to government data. The total number of frauds increased for the previous year, however the amount reported was a tad lower. In 2024, the number of frauds were about 19.2 lakh and the amount reported was Rs 22,848 crore. So, as a first step to control this menace, every fraud must be reported because it can make a difference in protecting the general public.

RBI and Government measures against SMS Fraud

The RBI has taken various steps to combat SMS fraud by using the same mediums of SMS, email, and phone calls to get the message out to the public. The RBI has issued alerts to the public, cautioning against unsolicited and fictitious offers received through SMS, email, or phone calls.

Genuine RBI communication is done through specific channels. The PIB has clarified that RBI does not send messages asking for banking details or account verification through unofficial channels. The regulator has also actively debunked fake schemes. 

The Press Information Bureau’s Fact Check unit has warned against a fake email scam that was circulating in the name of the RBI, where the fraudulent message claims that recipients are eligible for money under a “Donation Program,” lottery compensation or an inheritance fund, and has clarified that neither RBI nor any government authority has issued such offers.

With awareness being created, the public can now keep a closer eye out for such scams. But it is the individual’s responsibility to not fall for SMS frauds.

Steps to be taken to avoid SMS fraud

The most important part of SMS fraud prevention lies in the simple step to not provide the fraudster with the required information. Here are a few key steps a person should take in order to avoid SMS fraud in India.

1. Never share OTP, PIN, CVV or net banking password with anyone. A bank will never ask for this information, so it is best to never provide it, at any cost.

2. Individuals must stay alert and check the sender number or ID in a message before taking any action. They can use apps like Truecaller or any built-in caller id apps, in case of any doubts. Individuals can also save the phone numbers of the bank branch or the number of the branch manager or the common customer care number of the bank or any other financial services entity like insurance companies or stock brokers. 

3. If you receive shortened links or any weird unknown links, avoid clicking it. It is better to go to their website and check and check your mail inbox for genuine messages received from your bank. You can either manually type in the web address of the bank or avoid SMS or WhatsApp links completely.

4. Do not download APK files from unknown persons or sources and install it. You may receive it through Whatsapp links. Always make sure you install the banking apps or any finance related apps on your phone from the Google Play Store or the Apple App Store.

5. It is a good idea to set transaction alerts enabled for all of your bank accounts. RBI guidelines make it compulsory for banks to implement alert systems by registering customers for SMS alerts, along with email alerts for all digital transactions. These steps will help individuals to be alert in case of any unauthorized transactions.

6. Transaction limits for UPI, credit or debit cards, etc. must be set for each account based on the average monthly spend. If a fraudster gets access to someone’s account, this will limit the impact of the damage. This step is more beneficial when dealing with UPI-based scams.

7. Accounts that are used frequently for transactions must be protected by two-factor authentication. This extra layer of security will help individuals from unauthorized login attempts and fraudulent transactions.

8. Always update your phone OS and banking apps. Banks regularly update their apps with security patches. So it is imperative to update the apps to ensure that any vulnerabilities in your apps or phone are not exploited. 

9. If you receive a call or message from suspicious numbers, immediately block the numbers and report numbers. So that you do not attend these numbers even by mistake. 

Clicked a fraudulent link or shared OTP details?

Sometimes, you may fall victim to a fraud even if you stay alert. In those kinds of situations, you should not panic. The best thing to do is to act quickly and follow these steps.

The first thing to do is to contact your bank’s helpline and ask them to block your card or account, whichever is applicable.

Next is to ensure that your net banking password and UPI PIN are changed immediately. After that, take screenshots of the fraudulent message and note down the transaction ID, date, time and amount of any unauthorized debit, if there is one. This information is helpful for the victims when they are raising a complaint with the concerned authorities. 

The next step is to report the fraud to your bank and check with the banking executive if the transaction and the amount debited can be reversed, if possible. RBI has said categorically that banks must provide 24×7 access through phone banking, toll-free helplines, IVR and SMS services to customers for reporting unauthorized transactions. Customers are also advised to utilise the direct website link, if available, to report the fraud.

Conclusion